Realtor Conflicts and Buyer Agency

by Osman Parvez


According to the Colorado Realtor Commission approved definitions of working relationships, a buyer's agent "works solely on behalf of the buyer to promote the interests of the buyer with the utmost good faith, loyalty and fidelity." Yet, brokers are constantly bombarded with enticements that may create conflict with their responsibility as a Buyer's Agent.

Here's an example. Let's say I take up the realtor who emailed me today with an offer for $2500, a chair massage, gift certificates, and a free breakfast (click on image below). Later, when I bring my client to look at the property, at what stage should I disclose the additional bonus and little freebies?

We did broker open houses almost exclusively while I worked in real estate on Nantucket and it was the standard office ritual for Tuesdays and Thursdays. The higher priced listings (generally above $5MM) might offer wine, cheese, and various catered snacks. But cash bonuses for closings plus free massages and shopping gift certificates were unheard of, and for a good reason. Not only are these enticements of dubious benefit to finding a buyer, they also pose a potential conflict if not properly disclosed. To us that means immediately disclosing to our clients any additional benefits or relationships that may exist with the seller before showing the property.

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The ideas and strategies described in this blog are the opinion of the writer and subject to business, economic, and competitive uncertainties.   We strongly recommend conducting rigorous due diligence and obtaining professional advice before buying or selling real estate. 

Please Note

This document contains forward-looking statements. You are strongly cautioned that investment results are subject to business, economic and other uncertainties. There are no guarantees associated with any forecast and the opinions stated here are subject to change at any time. Always consult your financial advisor before making an investment decision.